There can be many strategies available for advisers to use when it comes to attracting high net worth clients, but what is the best one for your firm?
Talking on these issues to Simoney Kyriakou, content plus editor for FTAdviser, were Nick French, head of UK wealth management for Russell Investments and his colleague Alex Boni, associate director at Russell Investments.
One method which has been touted is to use technology and ‘big data’ to find out what wealthy clients might want and to use this in marketing.
However, Mr Boni said: “There is a place for this but I think when we talk about big data, we maybe think about bigger corporations harnessing that.
“For financial advisory practices their real strength is in their personability and in having a personal relationship with individuals.
“And when you start to resort to the kind of techniques the larger companies - private banks, DFMs - use, you start to forgo your trump card. I would focus more on the personal aspect.
“There may be useful information you can glean from big data but I do not think this is the silver bullet.”
Mr French agreed there was no silver bullet, and said the starting point was for advisers to look at their own business models first and understand what they really want to achieve.
He said: “Once they focus on reassessing what they do and how they do it, I think what they can do then is focus on building out other plans. The crucial thing to remember is attracting high net worth clients is a business strategy, not a marketing strategy.”
Many advisers may consider in order to attract high net worth clients, they themselves will have to put in a lot of money and time. Would it be worth their while to invest and does it show in the revenue stream?
Mr French answered it was a misconception that advisers have to spend money to get high net worth clients.
He explained: “A lot of the impact derived from attracting such clients is just the adviser making changes to what they do today, refocusing the business, providing information in a different way and improving communication.
“In terms of time there is a cost but there’s not a huge investment required. Obviously marketing the brand costs money, but I think in the beginning, attracting more high net worth clients does not need to cost more money.”
Mr Boni and Mr French were speaking after a Financial Adviser masterclass, held at the FT’s offices in London, during which they spoke about building up trust, communication and creating confidence in the client-adviser relationship.
You can read more about the masterclass in the 5 May edition of Financial Adviser. www.ftadviser.com/fa